TAL Education Group Announces Unaudited Financial Results for the Third Fiscal Quarter Ended November 30, 2020
-Net Revenues up by 35.0% Year-Over-Year for the Third Fiscal Quarter
-Net Revenues up by 29.7% Year-Over-Year for the First Nine Months of Fiscal Year 2021
-Total Student Enrollments of Normal Priced Long-term Course up by 46.5% Year-Over-Year
BEIJING, Jan. 21, 2021 /PRNewswire/ -- TAL Education Group (NYSE: TAL) ("TAL" or the "Company"), a leading K-12 after-school tutoring services provider in China, today announced its unaudited financial results for the third quarter of fiscal year 2021 ended November 30, 2020.
Highlights for the Third Quarter of Fiscal Year 2021
- Net revenues increased by 35.0% year-over-year to US$1,119.1 million from US$829.0 million in the same period of the prior year.
- Loss from operations was US$127.4 million, compared to income from operations of US$69.4 million in the same period of the prior year.
- Non-GAAP loss from operations, which excluded share-based compensation expenses, was US$73.4 million, compared to non-GAAP income from operations of US$99.6 million in the same period of the prior year.
- Net loss attributable to TAL was US$43.6 million, compared to net income attributable to TAL of US$19.6 million in the same period of the prior year.
- Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, was US$10.4 million, compared to non-GAAP net income attributable to TAL of US$49.7 million in the same period of the prior year.
- Basic and diluted net loss per American Depositary Share ("ADS") were both US$0.07. Non-GAAP basic and diluted net income per ADS, which excluded share-based compensation expenses, were both US$0.02. Three ADSs represent one Class A common share.
- Cash, cash equivalents and short-term investments totaled US$5,098.0 million as of November 30, 2020, compared to US$2,219.3 million as of February 29, 2020.
- Total student enrollments of normal priced long-term course increased by 46.5% year-over-year to approximately 3,397,030 from approximately 2,318,000 in the same period of the prior year.
Highlights for the Nine Months Ended November 30, 2020
- Net revenues increased by 29.7% year-over-year to US$3,133.1 million from US$2,415.6 million in the same period of the prior year.
- Loss from operations was US$141.0 million, compared to income from operations of US$178.7 million in the same period of the prior year.
- Non-GAAP loss from operations, which excluded share-based compensation expenses, was US$16.4 million, compared to non-GAAP income from operations of US$263.8 million in the same period of the prior year.
- Net income attributable to TAL was US$53.0 million, compared to net loss attributable to TAL of US$20.1 million in the same period of the prior year.
- Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, was US$177.6 million, compared to non-GAAP net income attributable to TAL of US$65.0 million in the same period of the prior year.
- Basic and diluted net income per ADS were US$0.09 and US$0.08 respectively. Non-GAAP basic and diluted net income per ADS, excluding share-based compensation expenses, were US$0.29 and US$0.28 respectively.
- Average student enrollments of normal priced long-term course per quarter during fiscal year 2021 increased by 60.9% year-over-year to approximately 3,995,210 from approximately 2,483,100 in the same period of fiscal year 2020.
- Total physical network increased from 871 learning centers in 70 cities as of February 29, 2020 to 990 learning centers in 102 cities as of November 30, 2020.
Financial and Operating Data——Third Quarter and First Nine Months of Fiscal Year 2021
(In US$ thousands, except per ADS data, student enrollments and percentages)
Three Months Ended | |||
November 30, | |||
2019 | 2020 | Pct. Change | |
Net revenues | 829,017 | 1,119,135 | 35.0% |
Operating income/(loss) | 69,421 | (127,389) | (283.5%) |
Non-GAAP operating income/(loss) | 99,560 | (73,354) | (173.7%) |
Net income/(loss) attributable to TAL | 19,562 | (43,608) | (322.9%) |
Non-GAAP net income attributable to TAL | 49,701 | 10,427 | (79.0%) |
Net income/(loss) per ADS attributable to TAL – basic | 0.03 | (0.07) | (319.1%) |
Net income/(loss) per ADS attributable to TAL – | 0.03 | (0.07) | (328.5%) |
Non-GAAP net income per ADS attributable to TAL – | 0.08 |
0.02 |
(79.4%) |
Non-GAAP net income per ADS attributable to TAL – | 0.08 |
0.02 |
(79.2%) |
Total Student Enrollments of normal priced long-term | 2,318,000 | 3,397,030 | 46.5% |
Nine Months Ended | |||
November 30, | |||
2019 | 2020 | Pct. Change | |
Net revenues | 2,415,626 | 3,133,066 | 29.7% |
Operating income/(loss) | 178,699 | (141,014) | (178.9%) |
Non-GAAP operating income/(loss) | 263,778 | (16,407) | (106.2%) |
Net (loss)/income attributable to TAL | (20,121) | 53,012 | (363.5%) |
Non-GAAP net income attributable to TAL | 64,958 | 177,619 | 173.4% |
Net (loss)/income per ADS attributable to | (0.03) | 0.09 | (359.7%) |
Net (loss)/income per ADS attributable to | (0.03) | 0.08 | (349.8%) |
Non-GAAP net income per ADS | 0.11 | 0.29 | 169.5% |
Non-GAAP net income per ADS | 0.10 | 0.28 | 170.8% |
Average Student Enrollments of normal | 2,483,100 | 3,995,210 | 60.9% |
"In the third quarter, along with the effective measures China's government has taken to continuously improve the public health situation and economy, we are pleased to see our tutoring business has also demonstrated on-track performance in this fiscal quarter. Looking ahead, we will keep making every effort to optimize our products, service and technology, and further build up our all-round education services with top quality content and customer experience," said Rong Luo, TAL's chief financial officer.
Financial Results for the Third Quarter of Fiscal Year 2021
Net Revenues
In the third quarter of fiscal year 2021, TAL reported net revenues of US$1,119.1 million, representing a 35.0% increase from US$829.0 million in the third quarter of fiscal year 2020. The increase was mainly driven by an increase in total student enrollments of normal priced long-term course, which increased by 46.5% to approximately 3,397,030 from approximately 2,318,000 in the same period of the prior year. The increase in total student enrollments of normal priced long-term course was primarily the result of the growth of enrollments in the small class offerings and online courses.
Operating Costs and Expenses
In the third quarter of fiscal year 2021, operating costs and expenses were US$1,255.9 million, representing a 65.1% increase from US$760.8 million in the third quarter of fiscal year 2020. Non-GAAP operating costs and expenses, which excluded share-based compensation expenses, were US$1,201.8 million, representing a 64.5% increase from US$730.7 million in the third quarter of fiscal year 2020.
Cost of revenues increased by 42.5% to US$515.6 million from US$361.8 million in the third quarter of fiscal year 2020. The increase in cost of revenues was mainly due to an increase in teacher compensation, rental costs and learning materials. Non-GAAP cost of revenues, which excluded share-based compensation expenses, increased by 42.5% to US$515.2 million, from US$361.6 million in the third quarter of fiscal year 2020.
Selling and marketing expenses increased by 120.3% to US$420.7 million from US$190.9 million in the third quarter of fiscal year 2020. Non-GAAP selling and marketing expenses, which excluded share-based compensation expenses, increased by 118.0% to US$406.4 million, from US$186.4 million in the third quarter of fiscal year 2020. The increase of selling and marketing expenses in the third quarter of fiscal year 2021 was primarily a result of more marketing promotion activities to expand our customer base and brand enhancement, as well as a rise in the compensation to sales and marketing staff to support a greater number of programs and service offerings compared to the same period in the prior year.
General and administrative expenses increased by 36.4% to US$283.8 million from US$208.1 million in the third quarter of fiscal year 2020. The increase in general and administrative expenses was mainly due to an increase of the number of our general and administrative personnel compared to the same period in the prior year and a rise in compensation to our general and administrative personnel. Non-GAAP general and administrative expenses, which excluded share-based compensation expenses, increased by 33.8% to US$244.5 million, from US$182.7 million in the third quarter of fiscal year 2020.
Total share-based compensation expenses allocated to the related operating costs and expenses increased by 79.3% to US$54.0 million in the third quarter of fiscal year 2021 from US$30.1 million in the same period of fiscal year 2020.
Impairment loss on intangible assets and goodwill was US$35.7 million for the third quarter of fiscal year 2021, compared to nil for the third quarter of fiscal year 2020. Impairment loss on goodwill was mainly due to the decline in a reporting unit's fair value.
Gross Profit
Gross profit increased by 29.2% to US$603.6 million from US$467.2 million in the third quarter of fiscal year 2020.
Income/(loss) from Operations
Loss from operations was US$127.4 million in the third quarter of fiscal year 2021, compared to income from operations of US$69.4 million in the third quarter of fiscal year 2020. Non-GAAP loss from operations was US$73.4 million, compared to Non-GAAP income from operations of US$99.6 million in the same period of the prior year.
Other (expense)/Income
Other income was US$45.5 million for the third quarter of fiscal year 2021, compared to other expense of US$3.7 million in the third quarter of fiscal year 2020. Other income in the third quarter of fiscal year 2021 was primarily due to the value-added tax and social security expense exemption offered by the government during the COVID-19 outbreak.
Impairment Loss on Long-term Investments
Impairment loss on long-term investments was US$11.5 million for the third quarter of fiscal year 2021, compared to US$46.4 million for the third quarter of fiscal year 2020. Impairment loss on long-term investments was mainly due to declines in the value of long-term investments in several investees.
Income Tax (expense)/Benefit
Income tax benefit was US$13.9 million in the third quarter of fiscal year 2021, compared to US$16.6 million of income tax expense in the third quarter of fiscal year 2020.
Net Income/(loss) Attributable to TAL Education Group
Net loss attributable to TAL was US$43.6 million in the third quarter of fiscal year 2021, compared to net income attributable to TAL of US$19.6 million in the third quarter of fiscal year 2020. Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, was US$10.4 million, compared to Non-GAAP net income attributable to TAL of US$49.7 million in the third quarter of fiscal year 2020.
Basic and Diluted Net Income/(loss) per ADS
Basic and diluted net loss per ADS were both US$0.07 in the third quarter of fiscal year 2021. Non-GAAP basic and diluted net income per ADS, which excluded share-based compensation expenses, were both US$0.02, in the third quarter of fiscal year 2021.
Cash Flow
Net cash flow provided by operating activities for the third quarter of fiscal year 2021 was US$844.6 million. Capital expenditures for the third quarter of fiscal year 2021 were US$42.2 million, an increase of US$2.1 million from US$40.1 million for the third quarter of fiscal year 2020. The increase was mainly due to leasehold improvement.
Cash, Cash Equivalents, and Short-Term Investments
As of November 30, 2020, the Company had US$4,233.2 million of cash and cash equivalents and US$864.8 million of short-term investments, compared to US$1,873.9 million of cash and cash equivalents and US$345.4 million of short-term investments as of February 29, 2020.
Deferred Revenue
The Company's deferred revenue balance was US$1,957.1 million, compared to US$1,241.2 million as of November 30, 2019, representing a year-over-year increase of 57.7%, which was mainly contributed by the tuition collected in advance of the fall semester, winter semester and part of spring semester of Xueersi Peiyou small classes and online courses through www.xueersi.com.
Financial Results for the First Nine Months of Fiscal Year 2021
Net Revenues
For the first nine months of fiscal year 2021, TAL reported net revenues of US$3,133.1 million, representing a 29.7% increase from US$2,415.6 million in the first nine months of fiscal year 2020. The increase was mainly driven by the growth in average student enrollments, which increased by 60.9% to approximately 3,995,210 from approximately 2,483,100 in the same period of the prior year. The increase in average student enrollments was primarily the result of the growth of enrollments in the small class offerings and online courses.
Operating Costs and Expenses
In the first nine months of fiscal year 2021, operating costs and expenses were US$3,291.5 million, a 46.5% increase from US$2,246.0 million in the first nine months of fiscal year 2020. Non-GAAP operating costs and expenses, which excluded share-based compensation expenses, were US$3,166.9 million, a 46.6% increase from US$2,160.9 million in the first nine months of fiscal year 2020.
Cost of revenues grew by 38.1% to US$1,467.1 million from US$1,062.7 million in the first nine months of fiscal year 2020. The increase in cost of revenues was mainly due to an increase in teacher compensation, rental costs and learning materials. Non-GAAP cost of revenues, which excluded share-based compensation expenses, increased by 38.1% to US$1,466.0 million from US$1,061.9 million in the first nine months of fiscal year 2020.
Selling and marketing expenses increased by 67.3% to US$1,019.6 million from US$609.6 million in the first nine months of fiscal year 2020. Non-GAAP selling and marketing expenses, which excluded share-based compensation expenses, increased by 65.6% to US$988.0 million from US$596.7 million in the first nine months of fiscal year 2020. The increase of selling and marketing expenses in the first nine months of fiscal year 2021 was primarily a result of more marketing promotion activities to expand our customer base and brand enhancement, as well as a rise in the compensation to sales and marketing staff to support a greater number of programs and service offerings compared to the same period in the prior year.
General and administrative expenses increased by 34.0% to US$768.7 million from US$573.7 million in the first nine months of fiscal year 2020. The increase in general and administrative expenses was mainly due to an increase of the number of our general and administrative personnel compared to the same period in the prior year and a rise in compensation to our general and administrative personnel. Non-GAAP general and administrative expenses, which excluded share-based compensation expenses, increased by 34.7% to US$676.9 million from US$502.4 million in the first nine months of fiscal year 2020.
Total share-based compensation expenses allocated to the related operating costs and expenses increased by 46.5% to US$124.6 million in the first nine months of fiscal year 2021 from US$85.1 million in the same period of fiscal year 2020.
Impairment loss on intangible assets and goodwill was US$36.0 million for the first nine months of fiscal year 2021, compared to nil for the same period of fiscal year 2020. Impairment loss on intangible assets and goodwill was mainly due to the decline in a reporting unit's fair value.
Gross Profit
Gross profit grew by 23.1% to US$1,666.0 million from US$1,352.9 million in the first nine months of fiscal year 2020.
Income/(loss) from Operations
Loss from operations was US$141.0 million in the first nine months of fiscal year 2021, compared to income from operations of US$178.7 million in the same period of the prior year. Non-GAAP loss from operations, which excluded share-based compensation expenses, was US$16.4 million for the first nine months of fiscal year 2021, compared to non-GAAP income from operations, which excluded share-based compensation expenses, was US$263.8 million in the first nine months of fiscal year 2020.
Other (expense)/Income
Other income was US$132.9 million for the first nine months of fiscal year 2021, primarily due to the value-added tax and social security expense exemption offered by the government during the COVID-19 outbreak. Other expense was US$90.6 million for the first nine months of fiscal year 2020, mainly related to loss from the fair value change of an equity security with readily determinable fair value.
Impairment Loss on Long-term Investments
Impairment loss on long-term investments was US$18.4 million for the first nine months of fiscal year 2021, compared to US$151.2 million for the first nine months of fiscal year 2020. Impairment loss on long-term investments was mainly due to declines in the value of long-term investments in several investees.
Income Tax Expense
Income tax expense was US$10.6 million in the first nine months of fiscal year 2021, compared to US$5.7 million of income tax expense in the first nine months of fiscal year 2020.
Net (loss)/Income Attributable to TAL Education Group
Net income attributable to TAL was US$53.0 million in the first nine months of fiscal year 2021, compared to net loss attributable to TAL of US$20.1 million in the first nine months of fiscal year 2020. Non-GAAP net income attributable to TAL, which excluded share-based compensation expenses, increased by 173.4% to US$177.6 million from US$65.0 million in the first nine months of fiscal year 2020.
Basic and Diluted Net Income per ADS
Basic and diluted net income per ADS were US$0.09 and US$0.08 respectively, in the first nine months of fiscal year 2021. Non-GAAP basic and Non-GAAP diluted net income per ADS, which excluded share-based compensation expenses, were US$0.29 and US$0.28 respectively.
Cash Flow
Net cash flow provided by operating activities for the first nine months of fiscal year 2021 was US$1,581.2 million. Capital expenditures for the first nine months of fiscal year 2021 were US$163.2 million, compared to US$125.2 million in the first nine months of fiscal year 2020. The increase was mainly due to the purchase of fixed assets and leasehold improvement.
Business Outlook
Based on our current estimates, total net revenues for the fourth quarter of fiscal year 2021 are expected to be between US$1,175.0 million and US$1,200.8 million, representing an increase of 37% to 40% on a year-over-year basis.
These estimates reflect the Company's current expectation, which is subject to change.
Conference Call
The Company will host a conference call and live webcast to discuss its financial results for the third fiscal quarter of fiscal year 2021 ended November 30, 2020 at 8:00 a.m. Eastern Time on January 21, 2021 (9:00 p.m. Beijing time on January 21, 2021).
Please note that you will need to pre-register for conference call participation, using the link provided below. Upon registering, you will be sent participant dial-in numbers, Direct Event passcode and unique registrant ID by email.
Conference call registration link: http://apac.directeventreg.com/registration/event/6743927. It will automatically direct you to the registration page of "TAL Education Group Third Quarter of Fiscal Year 2021 Earnings Conference Call", where you may fill in your details for RSVP. When you are requested to submit a participant conference ID, please enter the number "6743927".
In the 10 minutes prior to the call start time, you may use the conference access information (including dial-in number(s), Direct Event passcode and unique registrant ID) provided in the confirmation email that you have received following your pre-registration.
A live and archived webcast of the conference call will be available on the Investor Relations section of TAL's website at https://ir.100tal.com/.
A telephone replay of the conference call will be available through 7:59 a.m. on February 5, 2021, U.S. Eastern time (8:59 p.m. Beijing time on February 5, 2021).
The dial-in details for the replay are as follows:
- U.S. toll free: | +1-855-452-5696 |
- Hong Kong toll free: | 800-963-117 |
- International toll: | +61-2-8199-0299 |
Conference ID: | 6743927 |
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the outlook for the fourth quarter of fiscal year 2021, quotations from management in this announcement, as well as TAL Education Group's strategic and operational plans, contain forward-looking statements. The Company may also make written or oral forward-looking statements in its reports filed with, or furnished to, the U.S. Securities and Exchange Commission, in its annual reports to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company's ability to continue to attract students to enroll in its courses; the Company's ability to continue to recruit, train and retain qualified teachers; the Company's ability to improve the content of its existing course offerings and to develop new courses; the Company's ability to maintain and enhance its brand; the Company's ability to maintain and continue to improve its teaching results; and the Company's ability to compete effectively against its competitors. Further information regarding these and other risks is included in the Company's reports filed with, or furnished to the U.S. Securities and Exchange Commission. All information provided in this press release and in the attachments is as of the date of this press release, and TAL Education Group undertakes no duty to update such information or any forward-looking statement, except as required under applicable law.
About TAL Education Group
TAL Education Group is a leading K-12 after-school tutoring services provider in China. The acronym "TAL" stands for "Tomorrow Advancing Life", which reflects our vision to promote top learning opportunities for Chinese students through both high-quality teaching and content, as well as leading edge application of technology in the education experience. TAL Education Group offers comprehensive tutoring services to students from pre-school to the twelfth grade through three flexible class formats: small classes, personalized premium services, and online courses. Our tutoring services cover the core academic subjects in China's school curriculum as well as competence oriented programs. The Company's learning center network currently covers 102 cities.
We also operate www.jzb.com, a leading online education platform in China. Our ADSs trade on the New York Stock Exchange under the symbol "TAL".
About Non-GAAP Financial Measures
In evaluating its business, TAL considers and uses the following measures defined as non-GAAP financial measures by the SEC as supplemental metrics to review and assess its operating performance: non-GAAP operating costs and expenses, non-GAAP cost of revenues, non-GAAP selling and marketing expenses, non-GAAP general and administrative expenses, non-GAAP income from operations, non-GAAP net income attributable to TAL, non-GAAP basic and non-GAAP diluted net income per ADS. To present each of these non-GAAP measures, the Company excludes share-based compensation expenses. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. For more information on these non-GAAP financial measures, please see the table captioned "Reconciliations of non-GAAP measures to the most comparable GAAP measures" set forth at the end of this release.
TAL believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity by excluding share-based expenses that may not be indicative of its operating performance from a cash perspective. TAL believes that both management and investors benefit from these non-GAAP financial measures in assessing its performance and when planning and forecasting future periods. These non-GAAP financial measures also facilitate management's internal comparisons to TAL's historical performance and liquidity. TAL computes its non-GAAP financial measures using the same consistent method from quarter to quarter and from period to period. TAL believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making. A limitation of using non-GAAP measures is that these non-GAAP measures exclude share-based compensation charges that have been and will continue to be for the foreseeable future a significant recurring expense in the Company's business. Management compensates for these limitations by providing specific information regarding the GAAP amounts excluded from each non-GAAP measure. The accompanying tables have more details on the reconciliations between GAAP financial measures that are most directly comparable to non-GAAP financial measures.
For further information, please contact:
Echo Yan
Investor Relations
TAL Education Group
Tel: +86 10 5292 6658
Email: [email protected]
Caroline Straathof
IR Inside
Tel: +31 6 5462 4301
Email: [email protected]
TAL EDUCATION GROUP | ||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
(In thousands of U.S. dollars) | ||||
As of February 29, | As of November 30, | |||
ASSETS | ||||
Current assets | ||||
Cash and cash equivalents | $ 1,873,866 | $ 4,233,169 | ||
Restricted cash-current | 28,084 | 30,309 | ||
Short-term investments | 345,457 | 864,798 | ||
Inventory | 25,832 | 33,441 | ||
Amounts due from related parties-current | 3,642 | 3,205 | ||
Income tax receivables | 11,548 | 30 | ||
Prepaid expenses and other current assets | 207,352 | 260,568 | ||
Total current assets | 2,495,781 | 5,425,520 | ||
Restricted cash-non-current | 13,235 | 16,618 | ||
Property and equipment, net | 366,656 | 478,029 | ||
Deferred tax assets | 79,534 | 207,943 | ||
Rental deposits | 72,721 | 95,968 | ||
Intangible assets, net | 58,985 | 71,145 | ||
Land use right, net | 204,853 | 214,408 | ||
Goodwill | 378,913 | 522,927 | ||
Long-term investments | 571,601 | 620,331 | ||
Long-term prepayments and other non-current assets | 85,275 | 62,400 | ||
Operating lease right-of-use assets | 1,243,692 | 1,526,212 | ||
Total assets | $ 5,571,246 | $ 9,241,501 | ||
LIABILITIES AND EQUITY | ||||
Current liabilities | ||||
Accounts payable (including accounts payable of the | $ 117,770 | $ 238,513 | ||
Deferred revenue-current (including deferred revenue-current of | 780,167 | 1,926,673 | ||
Amounts due to related parties-current (including amounts due | 4,361 | 3,575 | ||
Accrued expenses and other current liabilities (including | 552,650 | 832,962 | ||
Income tax payable (including income tax payable of the | 46,650 | 88,327 | ||
Operating lease liabilities, current portion (including | 304,960 | 370,301 | ||
Total current liabilities | 1,806,558 | 3,460,351 | ||
Deferred revenue-non-current (including deferred revenue-non- | 833 | 30,468 | ||
Deferred tax liabilities (including deferred tax liabilities of the | 7,789 | 11,935 | ||
Long-term debt (including long-term debt of the consolidated | 261,950 | 265,100 | ||
Operating lease liabilities, non-current portion (including | 949,919 | 1,188,989 | ||
Total liabilities | 3,027,049 | 4,956,843 | ||
Mezzanine equity | ||||
Redeemable non-controlling interests | - | 1,775 | ||
Equity | ||||
Class A common shares | 133 | 142 | ||
Class B common shares | 67 | 67 | ||
Additional paid-in capital | 1,675,640 | 3,295,787 | ||
Statutory reserve | 82,712 | 81,852 | ||
Retained earnings | 786,097 | 833,318 | ||
Accumulated other comprehensive (loss)/income | (28,913) | 57,841 | ||
Total TAL Education Group's equity | 2,515,736 | 4,269,007 | ||
Noncontrolling interest | 28,461 | 13,876 | ||
Total equity | 2,544,197 | 4,282,883 | ||
Total liabilities, mezzanine equity and equity | $ 5,571,246 | $ 9,241,501 | ||
TAL EDUCATION GROUP | |||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||
(In thousands of U.S. dollars, except share, ADS, per share and per ADS data) | |||||||
For the Three Months Ended | For the Nine Months Ended | ||||||
2019 | 2020 | 2019 | 2020 | ||||
|
Net revenues |
$ 829,017 |
$ 1,119,135 |
$ 2,415,626 |
$ 3,133,066 | |||
Cost of revenues (note 1) | 361,817 | 515,560 | 1,062,687 | 1,467,112 | |||
Gross profit | 467,200 | 603,575 | 1,352,939 | 1,665,954 | |||
Operating expenses (note 1) | |||||||
Selling and marketing | 190,947 | 420,747 | 609,604 | 1,019,598 | |||
General and administrative | 208,071 | 283,827 | 573,712 | 768,719 | |||
Impairment loss on intangible | - | 35,727 | - | 36,031 | |||
Total operating expenses | 399,018 | 740,301 | 1,183,316 | 1,824,348 | |||
Government subsidies | 1,239 | 9,337 | 9,076 | 17,380 | |||
Income/(loss) from operations | 69,421 | (127,389) | 178,699 | (141,014) | |||
Interest income | 19,691 | 28,879 | 53,561 | 79,065 | |||
Interest expense | (2,735) | (2,714) | (7,963) | (9,378) | |||
Other (expense)/income | (3,732) | 45,507 | (90,618) | 132,948 | |||
Impairment loss on long-term | (46,408) | (11,472) | (151,196) | (18,357) | |||
Income/(loss) before provision | 36,237 | (67,189) | (17,517) | 43,264 | |||
Income tax (expense)/benefit | (16,611) | 13,887 | (5,736) | (10,556) | |||
(Loss)/income from equity | (3,206) | 411 | (5,895) | 6,352 | |||
Net income/(loss) | 16,420 | (52,891) | (29,148) | 39,060 | |||
Add: Net loss attributable to | 3,142 | 9,283 | 9,027 | 13,952 | |||
Total net income/(loss) | $ 19,562 | $ (43,608) | $ (20,121) | $ 53,012 | |||
Net income/(loss) per common | |||||||
Basic | $ 0.10 | $ (0.22) | $ (0.10) | $ 0.26 | |||
Diluted | 0.09 | (0.22) | (0.10) | 0.25 | |||
Net income/(loss) per ADS | |||||||
Basic | $ 0.03 | $ (0.07) | $ (0.03) | $ 0.09 | |||
Diluted | 0.03 | (0.07) | (0.03) | 0.08 | |||
Weighted average shares used in | |||||||
Basic | 198,555,124 | 202,039,751 | 197,882,722 | 200,786,811 | |||
Diluted | 207,120,564 | 202,039,751 | 197,882,722 | 208,710,216 | |||
Note1: Share-based compensation expenses are included in the operating costs and expenses as follows:
For the Three Months |
For the Nine Months Ended November 30, | ||||||||
2019 | 2020 | 2019 | 2020 | ||||||
Cost of revenues | $ 267 | $ 404 | $ 832 | $ 1,158 | |||||
Selling and marketing expenses | 4,534 | 14,322 | 12,951 | 31,644 | |||||
General and administrative expenses | 25,338 | 39,309 | 71,296 | 91,805 | |||||
Total | $ 30,139 | $ 54,035 | $ 85,079 | $ 124,607 | |||||
Note 2: Three ADSs represent one Class A common Share.
TAL EDUCATION GROUP | |||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF | |||||||
COMPREHENSIVE INCOME/(LOSS) | |||||||
(In thousands of U.S. dollars) | |||||||
For the Three Months Ended November 30, | For the Nine Months Ended November 30, | ||||||
2019 | 2020 | 2019 | 2020 | ||||
Net income/(loss) | $16,420 | $(52,891) | $(29,148) | $39,060 | |||
Other comprehensive | 22,195 | 54,944 | (53,528) | 87,834 | |||
Comprehensive income/(loss) | 38,615 | 2,053 | (82,676) | 126,894 | |||
Add: Comprehensive income | 2,537 | 8,581 | 11,085 | 12,872 | |||
Comprehensive income/(loss) | $41,152 | $10,634 | $(71,591) | $139,766 | |||
TAL EDUCATION GROUP | |||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF | |||||||
CASH FLOWS | |||||||
(In thousands of U.S. dollars) | |||||||
For the Three Months Ended November 30, | For the Nine Months Ended November 30, | ||||||
2019 | 2020 | 2019 | 2020 | ||||
Net cash provided by operating activities | $939,849 | $844,605 | $1,239,306 | $1,581,242 | |||
Net cash used in investing activities | (136,834) | (317,382) | (270,454) | (706,267) | |||
Net cash provided by financing activities | 270,886 | 1,499,351 | 131,227 | 1,492,512 | |||
Effect of exchange rate changes | 236 | 3,754 | 8,087 | (2,576) | |||
Net change in cash, cash equivalents and | 1,074,137 | 2,030,328 | 1,108,166 | 2,364,911 | |||
Cash, cash equivalents and restricted | 1,297,730 | 2,249,768 | 1,263,701 | 1,915,185 | |||
Cash, cash equivalents and restricted | $2,371,867 | $4,280,096 | $2,371,867 | $4,280,096 | |||
TAL EDUCATION GROUP | |||||||
Reconciliation of Non-GAAP Measures to the Most Comparable GAAP Measures | |||||||
(In thousands of U.S. dollars, except share, ADS, per share and per ADS data) | |||||||
For the Three Months Ended November 30, |
For the Nine Months | ||||||
2019 | 2020 | 2019 | 2020 | ||||
Cost of revenues | $ 361,817 | $ 515,560 | $ 1,062,687 | $ 1,467,112 | |||
Share-based compensation expense | 267 | 404 | 832 | 1,158 | |||
Non-GAAP cost of revenues | 361,550 | 515,156 | 1,061,855 | 1,465,954 | |||
Selling and marketing expenses | 190,947 | 420,747 | 609,604 | 1,019,598 | |||
Share-based compensation expense | 4,534 | 14,322 | 12,951 | 31,644 | |||
Non-GAAP selling and marketing | 186,413 | 406,425 | 596,653 | 987,954 | |||
|
General and administrative | 208,071 | 283,827 | 573,712 | 768,719 | |||
Share-based compensation expense | 25,338 | 39,309 | 71,296 | 91,805 | |||
Non-GAAP general and | 182,733 | 244,518 | 502,416 | 676,914 | |||
Operating costs and expenses | 760,835 | 1,255,861 | 2,246,003 | 3,291,460 | |||
Share-based compensation expense | 30,139 | 54,035 | 85,079 | 124,607 | |||
Non-GAAP operating costs and | 730,696 | 1,201,826 | 2,160,924 | 3,166,853 | |||
Income/(loss) from operations | 69,421 | (127,389) | 178,699 | (141,014) | |||
Share based compensation expenses | 30,139 | 54,035 | 85,079 | 124,607 | |||
Non-GAAP income/(loss) from | 99,560 | (73,354) | 263,778 | (16,407) | |||
Net income/(loss) attributable to | 19,562 | (43,608) | (20,121) | 53,012 | |||
Share based compensation expenses | 30,139 | 54,035 | 85,079 | 124,607 | |||
Non-GAAP net income | $ 49,701 | $ 10,427 | $ 64,958 | $ 177,619 | |||
|
Net income/(loss) per ADS | |||||||
Basic | $ 0.03 | $ (0.07) | $ (0.03) | $ 0.09 | |||
Diluted | 0.03 | (0.07) | (0.03) | 0.08 | |||
Non-GAAP Net income per ADS | |||||||
Basic | $ 0.08 | $ 0.02 | $ 0.11 | $ 0.29 | |||
Diluted | 0.08 | 0.02 | 0.10 | 0.28 | |||
ADSs used in calculating net | |||||||
Basic | 595,665,372 | 606,119,253 | 593,648,166 | 602,360,433 | |||
Diluted | 621,361,692 | 606,119,253 | 593,648,166 | 626,130,648 | |||
ADSs used in calculating Non- | |||||||
Basic | 595,665,372 | 606,119,253 | 593,648,166 | 602,360,433 | |||
Diluted | 621,361,692 | 627,950,637 | 620,250,195 | 626,130,648 | |||
SOURCE TAL Education Group
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